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Business > Business Unit 1.3 > Flashcards

Business Unit 1.3 Flashcards

1
Q

Give the keyword

“Targets expressed in money terms such as making a profit, earning income or building wealth”

A

Financial Objectives

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2
Q

What is meant by the term “S.M.A.R.T Targets”?

A

Specific, measurable, achievable, realistic and time bound

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3
Q 
What is the definition shared by these key terms?
Revenues
Sales Revenue
Turnover
Sales turnover
A

The amount of income received from selling goods over a period of time.

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4
Q

What is the total revenue formula?

A

TR=P x Q

total revenue = price x quantity

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5
Q

Unscramble the keyword and give the definition!

Lases Moluve

A

Sales Volume

The number of items or products or services sold by a business over a period of time.

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6
Q

What are fixed costs? Give some examples

A

Costs which do not vary with the output produced such as rent, business rates, advertising costs, administration costs and salaries.

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7
Q

What is meant by the term “Total costs” and whats the formula for it?

A

All the costs of a business
TC = FC + VC
total cost = fixed cost + variable cost

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8
Q

Whats the keyword?

“Costs which change directly with the number of products made by a business such as the cost of buying raw materials”

A

Variable Costs

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9
Q

“TR-TC=P”

What is the keyword and definition?

A

Profit

Occurs when the revenues of a business are greater than its costs over a period of time.

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10
Q

Unscramble the key word and give a definition!

Hasc Wolf

A

Cash Flow

The flow of cash into and out of a business

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11
Q

What is the difference between inflow and outflow?

A

Inflow is the amount cash flowing into a business, outflow is the amount of cash that’s flowing out

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12
Q

What is the keyword?
“The receipts of a business minus its payment”
What is the formula for this?

A

Net Cash flow

Inflows - Outflows = Net Cash Flow

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13
Q

What is the term called when a business can no longer pay its debts?

A

Insolvency

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14
Q

What is Cash Flow Forecast?

A

A prediction of how much cash will flow through the a business in a period of time in the future

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15
Q

Unscramble the word and give a definition!

Nipnonige elabanc

A

Opening Balance

The amount of money in a business at the start of a month

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16
Q

What is “Closing Balance”

A

The amount of money in the business at the end of the month

17
Q

What is meant by Trade Credit

A

Where a supplier gives a customer a period of time to pay a bill (or invoice) for goods or services once they have been delivered

18
Q

What is the keyword?
“Materials that a business holds. Some could be materials waiting to be used in the production process and some could be finished stock waiting to be delivered to customers. “

A

Stocks

19
Q

What is meant by long term finance?

A

Sources of money for businesses that are borrowed or invested typically for more than a year e.g Mortgage, Venture Capitalist

20
Q

What is short term finance?

A

Sources of money for businesses that may have to be repaid with immediately or fairly quickly, such as an overdraft, usually within a year.

21
Q

What can an owner use if he does not have any money left? Give the definition and the keyword

A

Personal Savings

Money that has been set aside and not been spent by family or individuals

22
Q

What is a “Share Capital”

A

The monetary value of a company which belongs to its shareholders, for example, if five people each invest £10,000 into a business, the share will be £50,000

23
Q

Give the keyword

“The owners of a company”

A

Shareholders

24
Q

What is a venture capitalist?

A

An individual or company which buys shares in what they hope will be a fast growing company with a long term view of selling the shares at a profit.

25
Q

What can you take out from a bank as a short term source of finance? Give the keyword and definition

A

Loan

Borrowing a sum of money which has to be repayed with interest over a period of time, e.g 1-5 years.

26
Q

What is meant by security (or collateral)

A

Assets owned by a business which are used to guarantee repayments of a loan; if the business fails to pay off the loan, the lender can sell what has been offered as security.

27
Q

What is meant by mortgage?

A

A loan where property is used as security

28
Q

What is the keyword?

“A share of the profits of a company received by shareholders who own shares. “

A

Dividend

29
Q

What is retained profit?

A

Profit which is kept back in the business and used to pay for investment in the business.

30
Q

Give the keyword

“Renting equipment or premises”

A

Leasing

31
Q

What is an overdraft facility?

A

Borrowing money from a bank by drawing more money than is actually in a current account. Interest is charged on the amount overdrawn.

32
Q

Give the keyword
“A source of finance where a business is able to receive cash immediately for the invoices it has issued from a factor, such as a bank, instead of waiting the typical 30 days to be paid. “

A

Factoring

Business (4 decks)

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